Needless
to say that adequate amount of advertising input is very necessary, not only to
get a good brand image but also to increase profits through sales.
Many
companies in Nigeria spend thousands of Naira on advertising. But then because
of conflicts of opinion on its importance and objectives, the advertising flops
and takes back seat.
Objective
setting is a very important step irrespective of the size of the company,
budget decisions are critical as the money spent on advertising may mean the
difference between success and failure.
Often
times than not, advertising budgets are thought of as huge expenses with vague
returns. But advertising budget should not be considered as expenses but as an
investment which if done properly can give real good profits.
While
planning for the advertisement budget you need to ask yourself questions
like; How much can i afford to spend on advertising and still achieve the
profit objective, how much would be the apportionment of the total
advertisement expenses on each product or product group, How much would be the
advertising budget allocation on new products, etc.
Anyway,
here are five specific factors to consider when deciding on the advertising
budget,
- Customer’s
Growth: Advertisement
requirements are different for different products, if you are just introducing
a product in the market, this will basically need large advertising budgets to
build awareness. Nevertheless, whether it’s an old product or new product you have to figure out how much it
costs to get a new customer. Then, you multiply that cost by the number of new
customers you want to acquire. The result is the amount you’ll need to budget
in order to hit your target.
- Market
share and consumer base: Building
market share by increasing market size requires large budget, on a cost per
impression basis. While products with high market share usually require low
budgets .It is less expensive to reach consumers of a widely used brand than to
reach consumers of low share brands.
- Competition
and clutter: In a market with a large number of competitors and a high
advertising spending, a brand must advertise more heavily to be heard. This method is simple in principle:
find out how much your competitors are spending, and use just a bit more than
that to market your company. The reality of doing this is a lot more difficult
than it seems, since it can be very hard to find out exactly how much your
competitors are spending. If you do manage to find out that information, this
method can be a great way to figure out how much to spend marketing.
- Advertising
frequency: The
number of repetitions needed to put across the brand’s message to consumers has
an important impact on the advertising budget.
- Product sustainability: A lot of industries have specific projections as to the amount you’ll need to spend on marketing if you want to make it. The best way to get these numbers is to find an association or organization that represents your industry and ask them for some averages. Once you have the averages, you can refine the actual costs based on your own situation and experience. Advertising is also important when a brand can offer unique physical benefits or features.
If you are thinking of advertising in Nigeria, please contact
PoiseMedia Communications at www.poisemedianigeria.com or check our contact at the bottom of this blog.
We can help you identify your market and reach them. We apply both BTL and ATL
strategies to project our clients’ brands to the right audience. We can do same
for you at very affordable price.
Lilian Izuorah
Business Development Officer
PoiseMedia Communications Ltd
Business Development Officer
PoiseMedia Communications Ltd
